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The report said that the UK’s 10,000 charitable foundations currently give away more than £2.7 billion (A$4.47 billion) a year – activities that create vast swathes of valuable data resources.

“But this data has not traditionally been seen as a resource in the same way that money has been, and this is a missed opportunity,” the report said.

The report argued that better use of this data would enable funders to improve their practice by:

Identifying and highlighting needs

Reducing inefficiencies in the application process

Understanding their impact

Testing perceptions and informing strategy

However, the research argued that a major shift in thinking was required before the charity sector would acknowledge data to be as valuable as money.

“Just a handful of charitable foundations [are] using data in this way, and many feeling ill-equipped to take advantage of the benefits data can offer,” the report said.

“Although open data is already successfully used to shape products, services and interventions across other sectors, grant-givers are only at the beginning of this journey.”

Among the reasons cited for this were limited capacity and concerns around how data will be presented, the report argued that leadership was vital to overcome the issues.

The report suggested that in the UK the Association for Charitable Foundations should take the lead on facilitating a sector-wide approach to data usage, to ensure that grant makers deliver the best possible impact for the people and communities they serve.

“There are steps that every grant maker can take individually to improve their use of data, such as using it to identify funding hot spots or to quickly identify and respond to emerging trends,” co-author of the report Ruth Gripper said.

“However, there is a lot to be gained by funders looking at this issue collectively. A sector approach could help to address the challenge of capacity and help ensure that funders become better at what they do, thus delivering increased impact for beneficiaries.

“Critical mass is key to achieving the full potential of data in the sector – the more grant makers publish and use data well, the more useful that resource becomes for everyone.

“We would like to see much more transparency and data-sharing in the sector, in recognition that data is a resource that has value for charities as well as for funders themselves.”

The report said that while the research was conducted primarily in the UK, funders from America had contributed insight to it and the findings had relevance for grant-making organisations the world over.

Explaining the key terms from the report:

Data: Data is the raw material from which information is obtained. The word “data” commonly evokes thoughts of numbers, spreadsheets and graphs. However, it is much broader than that. Data can be split into two categories: quantitative data consists of numbers and helps answer the questions “what, who, where and how many?” Qualitative data can be thought of as stories, and helps answer the questions “why and how?” Once collected, processed, organised and interpreted, data becomes a source of invaluable information.

Open data: Open data is data that anyone can access, use and share. It has a licence, ie stated permission to share – without this the data cannot be reused. Good open data is available in digital, machine-readable formats so that it can be easily processed. In practice, this means it is published as a spreadsheet – in xls or csv format, for example – rather than in pdf or image files. More information on different degrees of openness, and the costs and benefits of each for publisher and user, is available at 5 Star Open Data.

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